US investment giant BlackRock in $1 billion big battery play in Australia

US investment giant BlackRock is planning to invest at least $1 billion in big battery projects in Australia after agreeing to buy out Melbourne-based Akaysha Energy and its portfolio of at least nine projects in the country’s main grid.

This is the first battery storage investment made by BlackRock’s Climate Infrastructure business in the Asia-Pacific region and its biggest anywhere in the world. The entry of the deep-pocketed BlackRock will likely change the dynamics of the growing Australian battery storage market.

The most advanced project in Akaysha’s portfolio is the 150MW, 300MWh Ulinda Park battery next to the Kogan Creek coal generator in the Western Downs region of Queensland that it is co-developing, along with another two batteries in Queensland, with Renewable Energy Partners.

But its biggest project is the 1600MWh Orana big battery near Wellington in the central west of NSW, which could feature up to eight hours of storage and will be seeking a role in the state government’s Central West Orana renewable energy zone.

Its other projects include a big battery at the Palmerston substation near Launceston in Tasmania, which would use advanced inverters and act as a “virtual synchronous machine”, and would also be the first big battery in the island state.

The other projects in the portfolio are yet to be publicly revealed.

BlackRock says many gigawatts of battery storage will be needed to meet the federal government’s target of 82 per cent renewables by 2030, and to fill the gap created by the retirement of coal generators.

Currently, Australia’s main grid has only 10 operating large scale batteries, and a dozen or so in or near construction, although the pipeline of planned and potential projects is already in the tens of gigawatts and growing rapidly.

Charlie Reid, the co-head of climate infrastructure at BlackRock in the Asia-Pacific, says he is looking at Asia markets as well, where he sees a $US400 billion opportunity and the company has already committed $1 billion for Australia.

“As renewable energy infrastructure continues to mature in Australia, investment is required in battery storage assets to ensure the resilience and reliability of the grid, especially with the continued earlier-than-expected retirement of coal-fired power stations,” Reid said in a statement.

“For our clients, we see tremendous long-term growth potential in the development of advanced battery storage assets across Australia and in other Asia-Pacific markets and look forward to working with Akaysha to ensure an orderly transition to a cleaner and secure energy future.”